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Obama Checkmates Republicans By Offering a Sequester Escape Hatch Tied to More Revenue
President Obama took steps today to make sure that Republicans have already lost the sequester battle. He offered Republicans one way out, and that is to raise more revenue.
The president began by making reference to the signs of economic progress, but he also mentioned political dysfunction. Obama bluntly told Republicans that any deal to avoid the sequester will contain more revenue, “We can’t just cut our way to prosperity.” The president said the deep cuts Republicans are proposing don’t have to happen. Obama touted his balanced approach which he said has achieved 2.5 trillion in cuts. Obama said, “The proposals that I put forward during the fiscal cliff negotiations are still very much on the table.” The president said he has offered sensible reforms to Medicare and other entitlements, and his healthcare reforms that would reduce the government’s bills without shifting the burden on the elderly, poor, or working poor.
Obama said these modest reforms in entitlements have to go hand in hand with tax reform. The president said there is no reason that we should keep the loopholes, and use them for more tax cuts. The president said, “I think this balanced mix is the best way to finish off deficit reduction.”
Obama said a full budget might not be finished by the sequester deadline, but he offered Republicans an out. The president called on Congress to pass a smaller package of spending cuts and tax reform in order to delay the sequester for a few months until a budget is done. He said Congress is already working towards a budget that would replace the sequester, but they may need more time.
The president repeated that the economy is heading in the right direction, and the last thing we need is another self inflicted wound from Washington.
Obama is playing a winning hand. He is offering Republicans modest changes to Medicare in exchange for more revenue that will be generated by closing loopholes. Going after tax dodgers is a winning issue. The president has now put Republicans in the position of either having to defend tax dodgers, or face big cuts in defense spending. Republicans can pick their poison.
For a party that is ideologically driven by the notion of starving the governmental beast, the idea of having raise more revenue for Uncle Sam is a bitter pill to swallow. The president offered Republicans an escape hatch from the mess that they have created, but their lifeline is dependent on raising taxes by closing loopholes.
There is a possibility that the president may be able to come out of this latest standoff getting the deficit reduction he wants, increased revenue, and the protection of Medicare. (Before anyone jumps off the cliff on Medicare, the Republican alternative to Obama’s non-benefits cuts is gutting and privatization.)
Everything appears to be stacking up against the Republicans.
The Republican gamble on the sequester is looking like it may turn into an ever bigger win for President Obama.